Edison Yu, an analyst at Deutsche Bank, has expressed considerable optimism regarding the stock of American electric vehicle manufacturer Tesla. In his initial assessment, Yu’s ambitious price target has drawn significant attention. On Tuesday, Tesla’s stock reacted with a jump of 4.58%, reaching $226.17 on the NASDAQ. However, by Wednesday, it dipped 0.65% in pre-market trading to $224.70.
Strong Buy Recommendation Issued
Yu, who succeeded the well-known Tesla analyst Emmanuel Rosner after his departure from Deutsche Bank, initiated his coverage of Tesla with a price target of $295. This suggests that, compared to the current stock price, Yu believes Tesla could experience an increase of up to 30%.
Yu is notably more bullish than the majority of analysts. The average price target for Tesla’s stock stands at $211.46, which is below the current market level. Morgan Stanley remains the biggest bull among experts, setting their price target for the Musk-led company at $310.
Analyst Also Evaluates Future Business Prospects
Yu’s optimistic outlook is based on more than just Tesla’s automotive ventures. “At its core, we don’t view Tesla as merely a car manufacturer but rather as a technological platform aiming to reshape multiple industries, which warrants a unique valuation framework,” he explained, as reported by MarketWatch. He emphasised Tesla’s efforts to transform various sectors and argued that this ambition deserves a “one-of-a-kind valuation.” In his words, Tesla stands “in a class of its own.”
Yu’s assessment also took into account future business ventures in which Tesla has yet to generate revenue, including the robotaxi market and its robotics division. Despite Tesla’s lack of earnings in these sectors, Yu has already made concrete predictions. He expects Tesla’s robotaxi fleet to reach around one million vehicles by 2035, and he foresees the company selling approximately 200,000 humanoid Optimus robots by the same time.
Positive View on Tesla’s Automotive Business
In addition to these future projects, Yu is also optimistic about Tesla’s current automotive business. “Tesla has a structural lead in BEVs [battery electric vehicles], particularly in terms of scale and cost, and commands a significant brand value worldwide,” according to a report by Investing, which quoted Yu’s analysis. He is also looking forward to the upcoming “Robotaxi Day” on October 10, where he anticipates Tesla will unveil its first robotaxi, and he believes a new, more affordable model based on Tesla’s next-generation platform could also be revealed.
Battery Storage Business Growth Potential
Yu further believes that Tesla’s battery storage business holds significant growth potential. He projects that by 2025, Tesla could generate $13 billion in revenue from this segment alone, reflecting his bullish stance on Tesla’s broader future prospects.
